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Strategies & Market Trends : Buffettology -- Ignore unavailable to you. Want to Upgrade?

To: Freedom Fighter who wrote (2579)	7/6/2000 11:25:26 PM
From: James Clarke	Read Replies (5) \| Respond to of 4690

The more work I do on Abercrombie & Fitch (ANF) the more I think we've got another GAP here. The stock is up, but it is still trading at less than half what its worth according to my DCF analysis. If you don't like DCFs, think of it this way. Put a depressed Gap multiple of 22 on the earnings, and you've got a $30 stock. It trades at 14 and change. I'm in pretty big at 11 on the way down, and like an idiot I sat on my hands as it went down to 8 and bounced back quick. Today I added at 13 1/2. I think I know the company a lot better than I did when I first bought - at that point I just saw an absolute no-brainer. Now I see GPS in late 1995. GPS traded at about 4 1/2 split adjusted in late 1995 when I did all the work I needed to understand the stock but still missed a ten-bagger. At that time I recall I had Dell's annual report on my desk when it traded at 7 times earnings, and AOL's annual report six months later when it bottomed. Did a lot of work and found a reason not to buy any of them. Doh! You learn. My boss likes to say "There's nothing wrong with buying growth, as long as you don't pay for it."